Daily Chemical Reactions

Optimistic 2H20 Views Keep Street Expectations Elevated; US PGP Jumps (Again)
July 23, 2020
Commodities Mentioned:
Brent Crude, Natural Gas, Naphtha, Ethane, Ethylene, Propylene, Polyethylene, Polyurethanes, Polycarbonates, MTBE
Companies Mentioned:
Dow, Covestro, Croda, Sika, Repsol, PTT Group, LyondellBasell, CP Chem, Ineos, Total, Braskem, Huntsman, BASF, Eastman, Axalta, PPG, Johnson Matthey, PTTGCA, Chevron

Daily Chemical Reaction

 

Optimistic 2H20 Views Keep Street Expectations Elevated; US PGP Jumps (Again); Other Items

Key Points:

  • We comment on multiple 2Q20 sector reports (e.g. Dow, Covestro, Croda, Sika and Repsol), discuss Dow and Covestro volume trends, and examine 2H outlooks from multiple chemical producers. Expectations remain optimistic.
  • US polymer grade propylene (PGP) spot values reflect strength mid-week, and we flag the WoW downtick in US refinery operating rates as supportive. PGP spot (& contract) strength poses as a 2H20 margin headwind for buyers.
  • Other items today range from the PTTGCA move to add NGL storage in the NE US, a move upwards in the Asia naphtha crack as demand returns, and US MTBE moving to Mexico by rail due to other logistical issues.

See PDF below for all charts

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